The Hindu : International / India & World : India raises differential treatment issue

Online edition of India's National Newspaper
Wednesday, Aug 02, 2006

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International - India & World

India raises differential treatment issue

Amit Baruah

Domestic notification does not contravene the letter and spirit of the SAFTA Agreement, says Pakistan

— Photo: AP

SORTING IT OUT: Afghanistan Foreign Minister Rangeen Dadfar, Bhutanese Foreign Minister Khandu Wang Chuk, Minister of State for External Affairs E. Ahamed and Pakistan Foreign Minister Khurshid M. Kasuri at the SAARC meeting in Dhaka on Tuesday. — Photo: AP

DHAKA: Notwithstanding objections from Pakistan, India raised the issue of differential treatment accorded to it by Islamabad under the South Asia Free Trade Area (SAFTA) Agreement at an informal meeting of the SAARC Council of Ministers on Tuesday.

Minister of State for External Affairs E. Ahamed brought up the matter and will raise it again at the formal session on Wednesday.

Earlier in the day, Pakistan claimed that its domestic notification restricting trade with India to a positive list, as opposed to a sensitive or negative list required under SAFTA, was not against the agreement.

"We have done nothing that contravenes the letter and spirit of that [SAFTA] Agreement," Pakistani Foreign Secretary Riaz Mohammad Khan told presspersons.

In a rejoinder to the points made by India on Monday, Mr. Khan said New Delhi was indulging in propaganda and not following the procedure for dispute resolution laid down in the agreement.

"Bringing the matter to the Standing Committee [of Foreign Secretaries] and looking to the Council of [Foreign] Ministers is tantamount to jumping the procedure and disregard for the provisions of the SAFTA Agreement," he said.

Though he admitted that Pakistan had taken the bilateral route with India by the notification, when SAFTA was a multilateral agreement, he denied that Islamabad had denied tariff concessions. "With the operationalisation of SAFTA, Pakistan has extended tariff concessions to 90 per cent of the goods importable from India. Besides, in a large number of items a tariff of five per cent has been bound for all SAARC countries including India," he said.

`Restrictive trade regime'

Accusing India of maintaining a highly restrictive trade regime, replete with para-tariffs, composite tariffs and non-tariff barriers, he said: "The substantial increase in bilateral trade in the past several years has been entirely in favour of India. Our goods have found little access to the Indian market because of the multi-layered restrictive regime."

He regretted the exchange of words over SAFTA but took a philosophical view stating that the two nations were "quite used" to these things.

Hoping that there would be fewer occasions for such exchanges, he said rather than discussing trade matters in the bilateral composite dialogue or using SAFTA's dispute resolution mechanism, India had taken recourse to "propaganda and unfounded allegations."

Not bilateral

Reacting to the points made by Mr. Khan, Foreign Secretary Shyam Saran said the issue of differential treatment was neither technical nor bilateral.

"We are dealing with a regional trading arrangement, but one member country has decided unilaterally what it wants to do," Mr. Saran said.

According to him, the issues of using the appropriate dispute resolution mechanism would come up only when SAFTA was implemented.

In the case of India, Pakistan had decided not to do so, he said.

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